NBA Buyout Market Guide 2023

In early February of every year, the NBA trade deadline comes around. This is when the NBA buyout market gets going, and some players and their teams agree to part ways.

Generally, players that enter into the buyout market are veterans. Teams that are vying for playoff contention will make last-minute efforts to bolster their rosters with role players. Rebuilding clubs will opt to unload players who don’t fit into their short or long-term game plans.

Here we will go into detail about the NBA buyout market, explaining how buyouts work and more. Let's start by answering the most straightforward question below.

What Is an NBA Buyout?

Simply put, an NBA buyout occurs when a player and a team would prefer to part ways. Both parties agree, and there will generally be an agreement for the player to receive a portion of what remains on his contract. This enables the team to make the move to accommodate the player while still benefiting its own interests

Upon terms being agreed upon, the player is put on waivers (more on that later), and assuming they clear the 48-hour waiver wire, they become free agents. You might wonder exactly why a buyout might occur in the NBA. Let's answer that question.

Reasons for an NBA Buyout

There are various reasons why an NBA team and a player may mutually decide to part ways, including:

1. When teams acquire players that aren't a part of their immediate or long-term game plans as parts of trades. This situation will often occur when a veteran is obtained by a team that is out of playoff contention.
2. Sometimes a team will acquire a veteran while vying for a postseason spot, only to fail to make the playoffs. In this case, the veteran becomes unnecessary for that team and may be bought out. In some cases, the veteran himself may also have played under expectations.
3. A player may have requested a trade, and the team could not find a suitor by the trade deadline.
4. The player may want to explore new opportunities, while the team could use salary relief from the reduced remaining contract.

The Next Step

Once the team and the player agree that a buyout is the best option, the first step is to waive him. Then, the team and the player must negotiate how much of the contract must still be paid to the player.

Sometimes, the team may not agree to pay out any of the player's remaining salary. In this case, he can leave but with no pay. In others, an agreement can be reached where a portion of the remaining salary will be paid. Each negotiation is different.

Once a player is waived, they are an unrestricted free agent. They can now sign with any interested party. Let's look at the process of waivers and what it means to be waived.

What Is a Waiver?

Before a player can become a free agent in a buyout, they must be waived. Waivers are a 48-hour period during which NBA teams can bid for a player.

In a winning bid, the player will now play for that team instead of becoming a free agent. To claim the player, the team must fit his current salary into their payroll (or via an unused salary-cap exception). The new team will have now taken on the player's existing contract.

When teams place bids on waived players, you might wonder how it is decided which team is the winner. This is based on which team is lowest in the NBA standings. The reason for this is to help even the playing field and give struggling teams the chance to improve via the waiver wire.

Waiver claims of significant note are relatively rare in today's NBA. Any player that is being waived outright is likely not very valuable to their team and, therefore, any other team in most instances. Players on waivers before a buyout are pretty unlikely to be claimed at their full salary while on the waiver wire.

After clearing waivers, an NBA player that is part of a buyout is able to be obtained by a new team as a free agent. You might wonder about the next steps, so let's answer that question.

What Happens in an NBA Buyout After Waivers?

Upon a player in a buyout clearing waivers, his old team will still owe a portion of his salary in some cases. In others, the remaining salary will have been entirely eliminated, and he will be owned nothing. In any event, the player is now a free agent and can join a new team based on a new contract agreement.

The team must be able to sign the free agent using its remaining salary cap space or any eligible exception. In the case of contending teams, payroll is generally close to the maximum.

For this reason, you will generally find that many buyout free agents are offered close to the minimum NBA salary for their experience level. This is often all that a team can afford while staying under payroll.

This minimum salary varies depending on the player’s tenure in the league. It will be in the range of $2.6 - $2.9 million for true veterans in the NBA.

The Categories of NBA Buyout Players

You will see a few familiar player types on the NBA buyout market. Let's take a look at them.

Veterans: You will often find players that are past their prime as part of buyouts. They may have some value to a contending team due to their experience. Still, they may not fit into the plans of younger, rebuilding squads.

Players Acquired in Trade Packages: Sometimes, a player will be obtained as part of a trade package where the receiving team has no place for him. This can often occur when a player is included as a means for the trading team to reduce salary.

High Maintenance Players: Sometimes, a player may be simply problematic for the team. This can be due to attitude issues, inability to get along with teammates and coaches, or other factors.

Low-Performing Players: Perhaps a player is not meeting expectations, making a buyout appealing to the team. In some of these instances, the player may agree that a change of scenery could do them well, making it a win-win for both parties.

Can Players Request a Buyout?

A player can request a buyout, yet, the team doesn't have to comply. A good example is Jahlil Okafor, who requested a buyout or trade from the Philadelphia 76ers in 2017. The team held out for a trade and eventually dealt him to the Brooklyn Nets.

The Fate of the Old Contract

A common question regarding buyouts is what exactly happens to the old contract. The 2018 Dwyane Wade buyout from the Chicago Bulls is a high-profile example to illustrate how an existing contract would be affected by a buyout.

Wade was owed $23.8 million by the Bulls on his contract for that season. An agreement was reached for him to be paid $8 million and waived. This means that he left $15.5 million on the table in the agreement to be bought out.

This is a hefty amount for an NBA player to forfeit willingly. It illustrates just how much a player may want to be released from a specific situation at the expense of their own pocketbook.

The Duration of the NBA Buyout Market

The NBA buyout market is open all year, although it may seem that it is only active post-trade deadline. The vast majority of buyout action does occur after the deadline. This is when contending teams often make their final efforts to bolster their playoff rosters.

In addition, by the trade deadline, many non-contenders have a better idea of where they stand. This means they better grasp what kind of roster moves they should look to make.

The buyout market period effectively ends on March 1st, despite no technical end date. This is the last day that bought-out players can be eligible to compete in the NBA playoffs for that season. For this reason, a buyout would generally not occur after this date in any given season.

It is also worth noting that a free agent obtained after a buyout is not the same as a free agent who was not previously signed by another team. A player can also become a free agent upon completing their prior contract, not as part of a buyout.

The Restrictions on NBA Buyouts

Some restrictions had to be instituted in the NBA buyout market to prevent the exploitation of loopholes. A player cannot be obtained by their former team after a buyout for one year from the deal. Or until after his contract would have ended without a buyout, whichever is later.

There is, however, one exception. If a player is traded twice during the same season, then bought out or waived, he can return to the first team that traded him.

What Is the Benefit of a Buyout for a Team?

It could seem illogical that a team would want to pay a player even a partial portion of what is owed when he won't see the court. There are, however, tangible reasons that buyouts benefit NBA teams.

Saving Money From the Buyout

The most hand-to-mouth benefit to buying out an NBA player is saving money. Since many buyout negotiations involve only part of the contract needing to be paid, the team can clear up salary cap space for other players. In addition, there are occasions where a buyout enables the team to negate the contract entirely and owe the player no money.

In certain situations, a player may be of little value on the court and easily replaceable by a player making a much lower salary. Shaving some payroll while losing the negligible contributions of a bought-out player can make for a better team.

The Player Doesn't Fit the Team's Equation

In some instances, a player may have relevance in the NBA but simply not fit a team's timeline. Perhaps a lottery team is only concerned with rebuilding with younger talent and has an aging veteran on the roster.

Late in the season, they may prefer to get a look at their up-and-coming players rather than give minutes to a veteran. In this instance, it makes sense for both parties to buy the player out. The player may find a suitable spot on a contending team, while the upstart club can give minutes to younger players.

It is also pretty standard that a veteran player can be received in a trade when the receiving team knows they have no place for them. This will often occur when the team trading this player only does it to unload the salary. The team obtaining him is essentially taking a salary hit as part of the deal by taking on the contract.

In these instances, the receiving team may try to buy the player out to recoup some costs. If they simply waive the player, they will be fully responsible for the contract, assuming they don't get picked up on waivers.

Not Holding a Player Against Their Will

There is a degree of ethics involved, as there are situations where a team knows that a player does not want to be there. A great example is a veteran who is not getting minutes. He might have little time left in the NBA and could be a relevant role player for another team.

Not only is this simply the right thing to do and something that some teams will feel they owe their veterans. On top of it, it can benefit a team in future negotiations. Having a player-friendly reputation can pay dividends in the long term.

Plus, negotiations can usually be reached that benefit both parties while making the player happy. The team can save some money on a contract for a player that is not benefitting their current interests. The player can move on to greener pastures, and everyone is pleased with the results.

Notable 2023 NBA Buyouts

The 2023 NBA buyout market has ended, and the playoffs are underway. There is no time like now to discuss all of the most critical buyouts and waiver wire acquisitions that occurred for the 2022-2023 NBA season.

Russell Westbrook (bought out by Jazz, signed with Clippers)

The biggest news of all in the 2023 buyout market was the acquisition of Russell Westbrook by the Los Angeles Clippers. Despite reasonable statistical output, the controversial guard struggled to find consistent footing with the Lakers.

Upon his trade to the Jazz, he was quickly bought out as he was not a part of Utah's plans. He was then acquired by the Lakers' rival Clippers in what could amount to a bit of a revenge narrative were the two teams to face off in the 2023 postseason.

Goran Dragić (waived by Bulls, signed with Bucks)

Veteran point guard Goran Dragić was waived by the Chicago Bulls in February of 2023 to be acquired by Milwaukee leading up to their 2023 playoff run. His season for the Bulls was disappointing, and he had been inactive since February 15th before being waived. He has not received much playing time in the 2023 playoffs, but he gives the team some veteran depth and leadership.

Will Barton (bought out by Wizards, signed with Raptors)

The veteran guard/forward Will Barton, previously a critical piece on Denver, was bought out by the Washington Wizards in February of 2023. His season with Washington was a disappointment, including 11 DNPs before his buyout. He signed the Toronto Raptors for a run at the 2023 playoffs, who failed to make it despite a play-in game against the Bulls.

Patrick Beverley (bought out by Magic, signed with Bulls)

Patrick Beverley, 34, is another veteran player traded from the Lakers who wound up a part of the 2023 buyout market. He was dealt to the Magic and bought out shortly thereafter, to be picked up by the Bulls. Chicago made a run at the playoffs, getting to a couple of play-in games, but ultimately falling to the Heat.

Kevin Love (bought out by Cavaliers, signed with Heat)

In another notable move in a busy 2023 NBA buyout market, veteran forward Kevin Love was waived by the Cavaliers. He had fallen out of Cleveland's rotation, and the team felt they owed it to the veteran to give him the opportunity to play for a contender down the stretch. He got just that in signing with the playoff Heat and has received significant minutes this postseason for Miami.

Other 2023 NBA Buyouts

R.J. Hampton (Magic to Pistons)

Reggie Jackson (Hornets to Nuggets) 

Dewayne Dedmon (Spurs to 76ers)

Terrence Ross (Magic to Suns)

Danny Green (Grizzlies to Cavaliers)

Justin Holiday (Rockets to Mavericks)

Nerlens Noel (Pistons to Nets)

Stanley Johnson (waived by Spurs)

Juancho Hernangómez (waived by Raptors)

John Wall (waived by Rockets)

Serge Ibaka (waived by Pacers)

Final Words

The NBA buyout market is something that the majority of us basketball enthusiasts have heard of and get the gist of. Still, a total understanding of what it entails can be hazy for some.

We hope that we have been able to help NBA fans to grasp better what the buyout market is and how it works. This can make it much more fun to follow the late-season deals with a complete comprehension of their implications. Here's to taking this understanding into the 2023-2024 season and seeing what NBA buyout excitement ensues.